Global HR: Asia Pacific

In the second of our international series, Craig Donaldson finds that while HR in the Asia Pacific region is well developed, the profession in the UK remains more advanced in a number of ways.

The UK has been hit hard by the global financial crisis, and HR professionals have been placed at the forefront of organisational change as a result. The Asia Pacific region, which include much of East Asia, Southeast Asia, Australasia and Oceania, has also been affected, with local HR professionals facing similar challenges to their UK peers.

Peter Wilson, president of the Australian Human Resources Institute (AHRI), says getting through the downturn without a material loss of talent is an ongoing challenge for Australian organisations. “The war for talent hasn’t changed that much, and it won’t as we start to recover,” he says.

“People need to maintain their courage and avoid cutting good staff by accident, which is the risk we’ve had in previous recessions.”

Kristen Cooper, national president of the Human Resources Institute of New Zealand, says her members are facing a number of complex changes. “Many of our members working in mid-level roles have experience that spans only the good times and one major piece of employment legislation,” she says.

“Our relatively consistent employment context of the previous nine years is now much less predictable. Planning is difficult, people are in turmoil, and our HR people are expected to be able to support leaders who are dealing with difficult decisions that may include reducing workforces and definitely include doing the same – or more – for less, while they themselves are going through a big learning curve.”

Key differences

Julia Hughes, senior HR manager at pharmaceuticals firm Pfizer Australia, says there are pros and cons for HR professionals on both sides of the world. Having worked in both markets, she says one of the most notable examples is employment law.

“In the UK, the EU has a major impact on legislation; there are lots of laws governing employment, many quite complex,” she points out.

“In Australia, generally the market is freer of laws. The complicating factor here is the awards system – there are literally hundreds of awards and it would be impossible for you to know and understand them all, so there is a general reliance on legal counsel to help you where these are concerned.”

The differences between HR in the UK and New Zealand are mainly those of scale, according to Cooper. While the UK has businesses which are larger and more global, New Zealand tends to have more generalist HR roles than specialist ones, and budgets are accordingly smaller.

“Otherwise, though, the HR work itself and the expectations seem very similar to those in the UK,” says Cooper.

“Certainly our members who come from the UK have little trouble fitting in in New Zealand. They tend to be pleased with our relatively pragmatic approaches, if somewhat dismayed at our budgets.”

HR’s status

HR is increasingly well-regarded in New Zealand, says Cooper. Lead HR professionals tend to sit on the senior management teams in most organisations, and HR is viewed as a strategic partner.

“Management staff tend not to sit on boards of directors in New Zealand, so HR board appointments are embryonic here. Importantly, though, relatively few businesses still consider HR to be a process function,” she says.

Wilson says HR in Australia is also highly regarded, but she believes there is a persistent, damagingly negative stereotype of the profession, which diminishes in its power. “The back-room administrator, the reactive person who isn’t part of the top team, is a declining member of the species. If I look at the top 50 or even the top 100 companies, the vast majority of HR professionals there are members of the group executive,” he says.

Hughes says HR in Australia does not yet have the same level of recognition as it enjoys in the UK. “I believe the primary driver of this is that in the UK the Chartered Institute of Personnel and Development (CIPD) is the HR professional’s one-stop shop; it is a chartered institute with a reputation,” she says.

“Australia has not yet created a chartered body to help increase education for those entering the profession. I have kept on my CIPD membership to allow me to stay up-to-speed with current HR issues and initiatives.”

HR in Australia looks to the UK profession with both envy and respect, according to John Lunny, a consultant at law firm DLA Phillips Fox, who believes that the CIPD is seen as a polished professional body with excellent academic research and political credentials, whose input into both streams is accepted.

Lunny, who is also a chartered member of the CIPD and an AHRI fellow, says HR in Australia is still trying to raise its profile, but feels this remains a long way off and may always be a struggle. “Australian HR could learn a lot from the UK and how the CIPD has staked its claim for professionalism,” he says.

Cooper says UK HR is seen positively in New Zealand, and he believes there are a number of valuable lessons it can learn from the UK. “One thing that we are both proud of and frustrated by in New Zealand is our ability to achieve quite a lot with very little,” she says.

“It’s probably the ‘number 8 wire’ mentality Kiwis are known for [which holds that anything can be made or fixed with basic everyday materials, such as the number 8 gauge fencing wire seen on every Kiwi farm]. We know how to achieve a lot with relatively few resources – but we’d love to have more resources at our disposal.

“It’s great to hear what is happening in other places, because it’s both reassuring for us, and keeps us fuelled with more to think about and do. The UK is a natural peer for us.”

Asia calling

Dorin Whelly, head of HR, Asian region, at law firm Allen & Overy, says the HR profession in the UK (and other Western countries) is generally considered to be more progressive than its Asian counterparts.

“This is primarily because, historically and legally, the UK has had a head start in terms of how the employee-employer relationship has evolved from a purely contractual one to a more holistic one,” she says.

“The focus of the HR profession in the West has long since moved away from personnel and basic employee protection issues to those involving developing and nurturing employees, work-life balance, employing diverse workforces that represent the population, and creative ways to retain employees.”

Whelly says there are many examples of sophisticated and creative HR solutions coming to the fore in Asia, and strong HR professionals are well respected and sought after as advisers to the business.

“However, many HR departments in Asia still struggle to get out of the shadow of being seen as personnel departments who do recruitment and payroll,” she says.

“The UK is sometimes viewed as a better place to work because of more generous employee benefits, whether provided for by law or by companies, and common arrangements like flexi-time.”

The trade-off for HR professionals in Asia is longer working hours, but lower tax rates in countries such as Singapore and Hong Kong, and more flexibility in terms of how work can be organised, she says.

Lessons in HR

HR in Asia can be an exciting place to work because business in Asia is always open, says Whelly. She believes there are still many opportunities to build new systems and put forward new ideas alongside influential market leaders.

“Change is fast, speed is an asset and solutions are quick,” she adds. “Chances for advancement and increased responsibility are limited only by an individual’s abilities.”

And compared to the UK, there is significantly less bureaucracy for an HR professional to wade through to make decisions and push through new strategies.

“A strong HR professional can make a difference and see immediate impact on the business, whereas the career paths for HR professionals in the UK are more structured and follow a specific path.”

HR earning power UK v Australasia/Asia Pacific

AUSTRALIA

HR directors and heads of HR are the highest earners in their profession, according to a survey by HR recruitment firm HR Partners. The median total salary package for HR heads and directors is AUD$194,292 (£98,651), with the lower quartile earning an average base salary of AUD$130,000 per year. However, the role with the lowest salary within HR is an assistant, with the entry rate being as low as AUD$24,500 (£12,770) a year.

NEW ZEALAND

HR directors earned between AUD$120,000 (£60,918) to AUD$200,000 (£104,227), with an average of AUD$180,000, while HR managers earned between AUD$80,000 (£41,691) to $130,000 (£67,727), with an average of AUD$100,000 (£52.097), according to an HR salary survey from Hays Human Resources, while HR co-ordinators and administrators earn between AUD$42,000 (£21,877) to AUD$52,000 (£27.085), with an average of AUD$47,000 (£24,479).

SINGAPORE

HR directors earn a maximum of SGD$250,000 (£104,405) per year, while regional HR directors based in Singapore can earn up to SGD$350,000 (£148,784), according to a Hudson salary survey. However, HR officers can earn up to a maximum of SGD$65,000 (£27,634).

HONG KONG

The same survey found that HR directors can earn up to HKD$1.6m (£124,380) and regional HR directors based there HKD$2m (£157,085), while HR officers earn a maximum of HKD$360,000 (£28,275).

Employment standards

In Australia, employees are entitled to a range of leave types, including 20 days’ annual leave per year, 15 days’ sick leave per year, and 13 weeks’ long service leave after 10 years of service. The federal minimum wage is currently AUD$14.31 (£7.26) per hour or $543.78 (£283.21) per week (before tax).

In New Zealand, employees are entitled to a minimum of four weeks’ annual holidays after the first year of employment, while there is a minimum provision of five days’ paid sick leave after the first six months of continuous employment, and an additional five days’ paid sick leave is gained from that point on, after each subsequent 12-month period. The minimum wage in New Zealand is NZD$12.50 (£5.14) an hour, or NZD$500 (£210.90) for a 40-hour week

In Singapore, employees are entitled to seven days’ annual leave if they have worked for 12 months with the same employer, and thereafter, they receive one extra day for every additional year of work up to a maximum of 14 days. After six months of work, employees are entitled to 14 days of non-hospitalisation sick leave and 60 days of hospitalisation leave. Female employees are entitled to maternity leave four weeks before and four weeks after delivery of their child. There is no minimum wage in Singapore.

In Hong Kong, employees are entitled to annual leave with pay after 12 months of employment. This increases from seven days to a maximum of 14 days according to length of service. Paid sick days are accumulated at the rate of two paid days for each completed month of employment during the first 12 months of employment, and four paid sick days for each completed month of employment thereafter. Paid sick days can be accumulated up to a maximum of 120 days. Female employees are entitled to 10 weeks’ maternity leave. There is no minimum wage in Hong Kong (except for foreign domestic helpers).

Benchmark HR salaries in the UK with Celre salary data, part of the XpertHR group, at www.xperthr.co.uk/job-pricing

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